EU Gives Green Light To Sony-BMG Merger ... Again
October 3, 2007 at 5:47 AM (PT)
EU competition regulators gave a new green light to a recorded music joint venture between SONY MUSIC and GERMANY's BMG, after a court ordered a reassessment of the merger, reports EU BUSINESS. The EUROPEAN COMMISSION decided that the creation of SONY BMG "would not create or strengthen a dominant or collectively dominant position in the music markets."
The merger, which would give birth to the second-largest music group in the world, was originally approved by the COMMISSION, the EU's executive body and top competition regulator, in 2004. However independent music labels brought a case to the EUROPEAN COURT OF FIRST INSTANCE, the EU's second highest tribunal, citing competition problems.
They claimed the deal would stifle competition, as it would reduce the number of major music labels from five to four -- the others being UNIVERSAL, WARNER and EMI -- and that those companies would control 80% of the EUROPEAN music record market.
In JULY 2006, the judges in LUXEMBOURG ruled that the COMMISSION decision had been "riddled with errors" and suggested that it should re-examine the matter.